VC firm Pangea Trust launches web platform for Africans in diaspora to buy local shares

KENYA – Pangea Trust, a venture capital and investment firm, has launched a web platform that will allow Africans working abroad to buy shares virtually and in realtime in profitable startups back at home.

Dubbed Pangea Connect, the initiative will allow investors buy equity in startups from as low as US$100 (KSh13,000).

According to the Star, Pangea Trust co-founder Heaven Bereket revealed that the platform will be open for investors in Kenya, Somalia and Ethiopia.

“This platform was born out of our recent diaspora remittances survey that found out that many Africans living abroad have desire to invest back home but lack knowledge and investment options,” Bereket said.

The Diaspora Remittance Mapping survey released by the firm in November last year shows the biggest obstacle to enabling investments for the diaspora is accessing appropriately packaged and credible information on available investment opportunities.

At least 23 per cent of the diaspora residents found this as a major hurdle during the investment process.

This forces many to invest in dead or immovable assets especially land in rural areas and houses. This observation was noted by the diaspora remittances survey by the Central Bank of Kenya late last month.

Bereket said Pangea is working with diaspora alliances in various countries to sensitise would be investor on viable startups to invest in.

“We have vetted and helped several startups in the continent to be investor ready. We check their financial records, sales, directors, future and overall track record before bringing them on board,” Bereket.

So far, at least 20 startups have been listed on the web portal and the number is expected to grow in coming days after the launch.

She added that they are working with various money market regulators and financial institutions in host countries to weed out fraud and case of illicit financial flows.

“We also interested in firms that bring social economic change to their communities in line with Sustainable Development Goals (SDGs),” she said.

Diaspora remittances have been on the rise in Africa in the past decade, with at least $80 billion send back every year.

In Kenya, diaspora inflows have increased tremendously in recent years, with total remittances in 2021 reaching a record US$3.7 billion (KSh418 billion). This surpassed the previous record of US$3.1 billion set in 2020.

It is now the leading forex earner for Kenya, outdoing tea, coffee, tourism and horticulture since 2017.

According to CBK, the average value of remittances sent to the country is US$6,000 (KSh680,000).

At least 71 per cent of the respondents sent annual remittances of up to US$15,000 in 2019. Of these, 21 per cent sent remittances less than US$2000 while 48 per cent sent amounts less than US$6,000, an average of US$500 per month.

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